BILL ANALYSIS Ó
SB 643
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Date of Hearing: September 11, 2015
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Susan Bonilla, Chair
SB
643 (McGuire) -Amended September 4, 2015
(As Proposed to be Amended)
SENATE VOTE: 26-13
SUBJECT: Medical marijuana.
SUMMARY: Establishes a comprehensive licensing and regulatory
framework for the cultivation, manufacture, transportation,
storage, distribution, and sale of medical cannabis to be
administered by the Department of Consumer Affairs (DCA),
Department of Food and Agriculture (CDFA), and Department of
Public Health (CDPH), as specified. Specifically, this bill:
1)Requires the Medical Board of California (MBC) to prioritize
cases for repeated acts of clearly excessive recommending of
cannabis to patients without a good faith prior examination of
the patient and medical reason therefor, and specifies that it
is unprofessional conduct to recommend medical cannabis to a
patient without an appropriate prior examination and medical
indication.
2)Makes it a misdemeanor for a physician and surgeon who
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recommends cannabis to a patient for a medical purpose to
accept, solicit, or offer any form of remuneration from or to
a licensed facility if the physician and surgeon or his or her
immediate family has a financial stake in that facility.
3)Requires the MBC to consult with the California Marijuana
Research Program on developing and adopting guidelines for the
appropriate administration and use of medical cannabis.
4)Prohibits an individual who possesses a license in good
standing to practice medicine or osteopathy from recommending
medical cannabis to a patient unless that person is the
patient's attending physician, as specified.
5)Requires advertisements for physician recommendations for
medical cannabis to include a specified notice.
6)Requires the Governor to appoint a Chief of the Bureau of
Medical Marijuana Regulation (Bureau), within the DCA and
authorizes the Chief of the Bureau or a deputy to exercise
every power or duty given to the Director.
7)Vests in the DCA the sole authority to create, issue, renew,
discipline, suspend, or revoke licenses for medical marijuana
activities within the state and to collect related fees, and
authorizes the DCA to create additional licenses.
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8)Requires the CDFA to administer the provisions of the Act
related to the cultivation of medical cannabis, and to create,
issue, and suspend or revoke cultivation licenses for
violations of the Act.
9)Requires the CDPH to administer the provisions of the Act
related to the manufacturing and testing of medical cannabis.
10)Exempts from the licensure requirements of the Act qualified
patients who do not provide, donate, sell, or distribute
cannabis to any other person, and primary caregivers who
provide cannabis exclusively for medical purposes to no more
than five specified qualified patients, as specified.
11)Upon the date of implementation of regulations by the
licensing authority, prohibits any person from engaging in
commercial cannabis activity without possessing both a state
license and local authorization, and prohibits a licensee from
commencing activity under the authority of a state license
until the applicant has obtained a local license or permit, as
specified.
12)Provides that revocation of a local license terminates the
ability of a medical cannabis business to operate within that
local jurisdiction, and that revocation of a state license
terminates the ability of a licensee to operate within the
state.
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13)Prohibits a person from submitting an application for a state
license issued by the DCA unless that person has received
local authorization.
14)Requires an applicant for state license to, among other
things, submit fingerprints to the Department of Justice, and
provide documentation, issued by the local jurisdiction,
certifying that the applicant is in compliance with all local
ordinances and regulations; evidence of the legal right to
occupy the proposed location; for applicants with 20 or more
employees, provide a statement that the applicant will enter
into, or already has entered into, a labor peace agreement; a
seller's permit number; and other specified information.
15)Requires applicants seeking licensure as a testing laboratory
to register with the CDPH, and requires applicants seeking
licensure to cultivate, distribute, or manufacture medical
cannabis to include in their application a detailed
description of their operating procedures.
16)Requires a licensing authority to deny an application if the
applicant or the premises do not qualify for licensure under
the Act, and authorizes a licensing authority to deny a
license or license renewal for specified acts.
17)Requires the CDFA to promulgate regulations governing the
licensing of indoor and outdoor cultivation sites.
18)Requires the Department of Pesticide Regulation (DPR), in
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consultation with the CDFA, to develop standards for the use
of pesticides in cultivation, and maximum tolerances for
pesticides and other foreign object residue in harvested
cannabis.
19)Requires the CDPH to develop standards for the production and
labeling of all edible medical cannabis products.
20)Requires the CDFA, in consultation with the Department of
Fish and Wildlife and the State Water Resources Control Board,
to ensure that individual and cumulative effects of water
diversion and discharge associated with cultivation do not
affect the in stream flows needed for fish spawning,
migration, and rearing, and the flows needed to maintain
natural flow variability.
21)Provides the CDFA with the authority necessary for the
implementation of regulations it adopts pursuant to the Act,
and requires those regulations: to regulate weighing or
measuring devices; require that cannabis cultivation is
conducted in accordance with state and local laws; establish
procedures for the issuance and revocation of unique
identifiers for cannabis cultivation activities; and prescribe
standards, in consultation with the Bureau, for the reporting
of necessary information relating to unique identifiers.
22)Requires the DPR, in consultation with the State Water
Resources Control Board, to promulgate regulations that
require that the application of pesticides or other pest
control in connection with the cultivation of medical cannabis
to meet standards equivalent to existing law.
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23)Specifies various license types for state cultivator licenses
issued by the CDFA, including licenses for special outdoor,
specialty indoor, specialty mixed-light, small outdoor, small
indoor, small mixed-light, outdoor, indoor, and mixed-light
cultivation, and nursery licenses, and requires the CDFA to
limit the number of outdoor, indoor, and mixed-light licenses,
as specified.
24)By January 1, 2020, requires the CDFA, in conjunction with
the Bureau, to make available a certified organic designation
and organic certification program for medical marijuana, if
permitted under federal and state law, as specified.
25)Authorizes the Bureau to establish appellations of origin for
marijuana grown in California.
26)Requires an employee engaged in commercial cannabis activity
to be subject to Wage Order 4-2001 of the Industrial Welfare
Commission.
27)Requires the CDFA, in consultation with the Bureau, to
establish a track and trace program for reporting the movement
of medical marijuana items throughout the distribution chain
that use a unique identifier and secure packaging, and is
capable of providing specified information, including the
licensee receiving the product, the transaction date, and the
cultivator from which the product originates.
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28)Requires the CDFA to create an electronic database containing
the electronic shipping manifests which shall include the
quantity, or weight, and variety of products shipped and
received; estimated and actual times of departure and arrival;
and license number and unique identifiers issued by the
licensing authority for all licensees involved in the shipping
process.
29)Requires the database to be designed to flag irregularities
for all licensing authorities to investigate, and authorizes
all licensing authorities to access the database and share
information related to licensees.
30)Requires the CDFA to immediately notify the Bureau of any
irregularity or suspicious finding relating to a licensee or
applicant, and requires the Bureau to have 24 hour access to
the database.
31) Authorizes licensing authorities and state and local
agencies to inspect shipments and request documentation for
current inventory.
32)Requires licensing authorities, upon request of a state or
local law enforcement agency, to allow access to information
contained within the database to assist law enforcement, as
specified.
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33)Provides that licensed transporters authorized to transport
medical cannabis and medical cannabis products between
licensees shall only do so as set forth in the Act.
34)Prior to transporting medical cannabis or medical cannabis
products, requires a licensed transporter to complete an
electronic shipping manifest and to transmit that manifest to
the Bureau and the licensee that will receive the medical
cannabis product.
35)Requires licensees receiving the shipment to submit to the
licensing agency a record verifying receipt of the shipment
and details of the shipment.
36)Prohibits a local jurisdiction from preventing transportation
of medical cannabis or medical cannabis products on public
roads by a licensee transporting medical cannabis or medical
cannabis products in compliance with the Act.
37)Authorizes a county to impose a tax on the privilege of
cultivating, dispensing, producing, processing, preparing,
storing, providing, donating, selling, or distributing medical
cannabis or medical cannabis products by a licensee operating
pursuant to the Act, as specified.
38)Provides that the provisions of this Act are severable if any
provision or its application is invalid.
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39)Makes this bill operative only if AB 266 (Bonta, Cooley,
Jones-Sawyer, Lackey, and Wood) and AB 243 (Wood) of the
current legislative session is enacted and takes effect on or
before January 1, 2016.
40)Makes other technical and conforming changes.
EXISTING LAW:
1)Recognizes the authority of cities and counties to make and
enforce, within their borders, all local, police, sanitary,
and other ordinances and regulations not in conflict with
general interest laws. (Cal. Const. Article XI sec. 7)
2)Prohibits the possession, possession with intent to sell,
cultivation, sale, transportation, importation, or furnishing
of marijuana, except as otherwise provided by law. (Health
and Safety Code (HSC) Sections 11357, 11358, 11359, and 11360)
3)Prohibits prosecution of a patient or a patient's primary
caregiver, under the Compassionate Use Act of 1996 (CUA), an
initiative measure, for possessing or cultivating marijuana
for personal medical purposes of the patient upon the written
or oral recommendation or approval of a physician. (HSC
Section 11362.5)
4)Licenses and regulates physicians and surgeons, including
osteopathic physicians, under the Medical Practice Act (Act)
by the MBC within the DCA. (Business and Professions Code
(BPC) Section 2000 et seq.)
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5)Defines "attending physician" as an individual who possesses a
license in good standing to practice medicine or osteopathy
issued by the MBC or the Osteopathic Medical Board of
California (OMB) and who has taken responsibility for an
aspect of the medical care, treatment, diagnosis, counseling,
or referral of a patient and who has conducted a medical
examination of that patient before recording in the patient's
medical record the physician's assessment of whether the
patient has a serious medical condition and whether the
medical use of marijuana is appropriate. (HSC Section
11362.7(a))
6)Defines "primary caregiver," for purposes of the CUA, as the
individual designated by a patient who has consistently
assumed responsibility for the housing, health, or safety of
that person. (HSC Section 11362.7(d))
7)Requires the CDPH to establish and maintain a voluntary
Medical Marijuana Program (MMP) for qualified patients to
apply for identification cards, and county health departments
to issue identification cards to qualified patients and their
caregivers. (HSC Section 11362.7 et seq.)
8)Provides that qualified patients, persons with valid
identification cards, and their designated primary caregivers
who associate in order to collectively or cooperatively to
cultivate marijuana, are not subject to criminal liability
solely on that basis. (HSC Section 11362.775)
FISCAL EFFECT: Unknown. This bill is keyed fiscal by the
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Legislative Counsel.
COMMENTS:
Purpose. This bill is author sponsored. According to the
author, "SB 643 seeks to resolve many of the issues created by
the enactment of the Compassionate Use Act and subsequent
legislation?.California voters made it clear that they wanted
medical marijuana to be legalized, but issues and concerns for
growers, doctors, dispensaries, law enforcement, district
attorneys, cities, counties and others have only become more
complicated?Since the voters of California passed Proposition
215 in 1996, it has become clear that there needs to be a
comprehensive regulation bill from the Legislature that oversees
the cultivating, processing, manufacturing, transportation,
prescribing and sale of medical marijuana?."
This bill is drafted to work in conjunction with AB 266 (Bonta,
Cooley, Jones-Sawyer, and Lackey) and AB 243 (Wood) of the
current legislative session, and is contingent upon the
enactment of both of those bills.
The Compassionate Use Act (CUA) and SB 420. In 1996, voters
approved the CUA, which allowed patients and primary caregivers
to obtain and use medical marijuana, as recommended by a
physician, and prohibited physicians from being punished or
denied any right or privilege for making a medical marijuana
recommendation to a patient. Senate Bill 420 (Vasconcellos,
Statutes of 2003, Chapter 875), established the MMP, which
allowed patients and primary caregivers to collectively and
cooperatively cultivate medical marijuana, and established a
medical marijuana card program for patients to use on a
voluntary basis. However, since the passage of Proposition 215
and SB 420, the state has not adopted a framework to provide for
appropriate licensure and regulation of medical marijuana. As a
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result, in the nearly 20 years since the passage of Proposition
215, there has been an explosion of medical marijuana
collectives and cooperatives that are largely left to the
enforcement of local governments, resulting in the creation of a
patchwork of local regulations for these industries and with
little statewide involvement.
The California Attorney General's Compassionate Use Guidelines.
SB 420 required the California Attorney General to "?develop and
adopt appropriate guidelines to ensure the security and
non-diversion of marijuana grown for medical use by patients
qualified under the Compassionate Use Act of 1996." In 2008,
the Attorney General issued guidelines to: 1) ensure that
marijuana grown for medical purposes remains secure and does not
find its way to non-patients or illicit markets, 2) help law
enforcement agencies perform their duties effectively and in
accordance with California law, and 3) help patients and primary
caregivers understand how they may cultivate, transport,
possess, and use medical marijuana under California law.
According to a 2011 letter, after a series of meeting with
stakeholders to assess whether to clarify the 2008 guidelines to
stop the exploitation of California's medical marijuana laws by
gangs, criminal enterprises, and others, the Attorney General
decided to postpone the issuance of new guidelines because of
pending litigation and to urge the Legislature to amend the law
to establish clear rules governing access to medical marijuana.
California Supreme Court Affirms Local Control Over Medical
Marijuana. By exempting qualified patients and caregivers from
prosecution for using or from collectively or cooperatively
cultivating medical marijuana, the CUA and the MPP essentially
authorized the cultivation and use of medical marijuana. These
laws have triggered the growth of medical marijuana dispensaries
in many localities, and in response, local governments have
sought to exercise their police powers to regulate or ban
activities relating to medical marijuana. After numerous court
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cases and years of uncertainty relating to the ability of local
governments to control medical marijuana activities,
particularly relating to the ability to control the zoning,
operation, and existence of medical marijuana dispensaries, the
California Supreme Court, in City of Riverside v. Inland Empire
Patients (2013) 56 Cal. 4th 729, held that California's medical
marijuana statutes do not preempt a local ban on facilities that
distribute medical marijuana. The court held that nothing in
the CUA or the MMP expressly or impliedly limited the inherent
authority of a local jurisdiction, by its own ordinances, to
regulate the use of its land, including the authority to provide
that facilities for the distribution of medical marijuana will
not be permitted to operate within its borders.
Federal Controlled Substances Act. Despite the CUA and SB 420,
marijuana is still illegal under state and federal law. Under
California law, marijuana is listed as a hallucinogenic
substance in Schedule I of the California Uniform Controlled
Substances Act. Yet, the CUA prohibits prosecution for
obtaining, distributing, or using marijuana for medical
purposes. However, under the federal Controlled Substances Act,
it is unlawful for any person to manufacture, distribute,
dispense or possess a controlled substance, including marijuana,
whether or not it is for a medical purpose. As a result,
patients, caregivers, and dispensary operators, who engage in
activities relating to medical marijuana, may still vulnerable
to federal arrest and prosecution. According to the California
Attorney General's guidelines, the difference between state and
federal law gives rise to confusion. However, California has
tried to avoid this conflict by deciding not to use the state's
powers to punish certain marijuana offenses under state law when
a physician has recommended its use to treat a serious medical
condition.
United States Department of Justice (USDOJ) Guidance Regarding
Marijuana Enforcement. On August 29, 2013, the USDOJ issued a
memorandum that updated its guidance to all United States
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Attorneys in light of state ballot initiatives to legalize under
state law the possession of small amounts of marijuana and
provide for the regulation of marijuana production, processing,
and sale. While the memorandum noted that illegal distribution
and sale of marijuana is a serious crime that provides a
significant source of revenue to large-scale criminal
enterprises, gangs, and cartels, it also noted that USDOJ is
committed to using its limited investigative and prosecutorial
resources to address the most significant threats. According to
the USDOJ, "In jurisdictions that have enacted laws legalizing
marijuana in some form and that have also implemented strong and
effective regulatory and enforcement systems to control the
cultivation, distribution, sale, and possession of marijuana,
conduct in compliance with those laws and regulations is less
likely to threaten the federal priorities set forth above?In
those circumstances, consistent with the traditional allocation
of federal-state efforts in this area, enforcement of state law
by state and local law enforcement and regulatory bodies should
remain the primary means of addressing marijuana-related
activity."
Marijuana Frameworks Established in Other States. There are
currently 23 states, plus the District of Columbia, that allow
for medical marijuana and have some level of regulation.
California is the only state that permits medical marijuana in
the absence of a robust state-wide regulatory system. The
following states have statewide medical marijuana regulatory
systems: Alaska, Arizona, Colorado, Connecticut, Washington DC,
Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts,
Michigan, Minnesota, Montana, Nevada, New Hampshire, New Jersey,
New Mexico, New York, Oregon, Rhode Island, Vermont and
Washington. In addition, Alaska, Colorado, Oregon, Washington,
and the District of Columbia have legalized the use of
recreational marijuana.
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According to the Brookings Institute, since the early 1990s,
U.S. public opinion has trended in favor of marijuana
legalization. Currently, a majority of Americans support
legalization by a margin of seven points-52 percent to 45
percent, according to findings from a Pew Research Center survey
in March 2013. Support for marijuana legalization has risen
sharply since 2010, by 11 percentage points.
This increasing support for marijuana legalization is present in
California as well, with recent polls showing that a majority of
Californians support marijuana legalization. Currently, there
are multiple marijuana initiatives attempting to qualify for the
2016 ballot. In order for any marijuana scheme to be effective,
it should address all parts of the industry, including
establishing a robust licensing and regulatory scheme, a
taxation scheme, and incorporate health and safety standards, in
addition to ensuring that the public is protected; however, if
the measure is too prescriptive, it may hamper the ability to
address any unintended consequences or fill in any policy gaps
without having to go back to the ballot. As a result, if the
State is able to create a comprehensive framework for medical
cannabis, it may also serve a dual role by serving as a basis
for a recreational marijuana scheme.
Medical Marijuana Industry in California. According to the
author's Sunrise Questionnaire, submitted to the Committee
pursuant to Government Code Section 9148 et seq., by law
enforcement estimates, over 60% of all marijuana in the country
is grown in the Emerald Triangle counties of Humboldt, Mendocino
and Trinity, all of which are in the author's district, and once
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the industry is regulated, and the medical marijuana products
are certified as safe, the market is expected to open up
substantially. In addition, once the industry is regulated, the
author believes that physicians who do not recommend or even
discuss medical marijuana due to its quasi-legal nature and
outright ban from the federal government may be more willing to
discuss and recommend medical marijuana to their patients.
The author asserts that the harm starts at the environmental
side of things, and simply expands from there. The regional and
State Water Boards, along with California Department of Fish and
Wildlife, are doing what they can, but without legislation,
their hands are largely tied. This leads to streams and rivers
literally running dry (even before the current drought) and to
huge loads of sediments and toxic wastes being dumped into the
watersheds. According to the author, the lack of regulation
complicates water supply for millions of legal residential and
commercial water users throughout the state-- entire tracts of
forests are being mowed down by rogue growers and planted with
marijuana with no permits, oversight, or regard for the
environment.
The author also believes that the lack of regulation on the
processing, manufacturing, testing, transportation and resale
needs to be fixed as well, and that without statewide standards
produced by specific health and safety testing, ingredient
lists, and dosage listings on all marijuana products, people are
put at risk.
According to the author, cities and counties that have medical
marijuana ordinances take the first step in protecting consumers
and the public, but without a strong state-wide regulatory body
overseeing all aspects of the product chain, consumers have very
little control over the risk unless they have personal knowledge
of the product. The author believes that clear guidelines from
the state and or the local jurisdiction, backed up by the state,
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is the only way to ensure protection of consumers and the
public.
REGISTERED SUPPORT / OPPOSITION:
Support
None on file.
Opposition
None on file.
Analysis Prepared by:Eunie Linden / B. & P. / (916)
319-3301